MSC Bank auditors asked to give report by June-end

The Maharashtra cooperation department and the two government-appointed administrators have asked the statutory auditors of Maharashtra State Cooperative Bank (MSC Bank), Batliboi & Co, to give their report on the bank’s balance sheet for 2010-11 by the end of this month. If the report comes by month-end, the lender would be in a position to get refinance from the National Bank for Agriculture and Rural Development (Nabard), they say.

The two administrators were appointed by the state government last month after the accounts of the cooperative bank showed negative net worth for 2009-10.

The statutory audit report is crucial, since the bank has claimed that its net worth had turned positive to Rs 238.14 crore by the end of March 31, 2011, from a deficit Rs 144.22 crore a year ago. The bank has earned an operative profit of Rs 15.82 crore and it was able to reduce its net loss to Rs 506.43 crore in 2010-11 from Rs 775.98 crore.

“Once the statutory auditors inspect the balance sheet of 2010-11 and submit their remarks conveying the bank’s turnaround, it will be possible for MSC Bank to seek refinance from Nabard. The refinance limit will be of Rs 2,160 crore. Once MSC Bank gets the refinance, it will be able to lend to district cental cooperative banks for the disbursement of kharif loan,” a senior state government official told Business Standard.

The state has finalised a crop loan target of Rs 23,000 crore, comprising Rs 18,000 crore for kharif crops and the balance for the rabi season.